Until recently, the law, like many other federal antidiscrimination laws, encompassed two legal theories: discriminatory treatment and discriminatory impact. Discriminatory treatment involves intentional harm based on race, color, national origin or some other protected characteristic. Discriminatory impact, on the other hand, occurs when an otherwise neutral policy or action causes a disproportionate and unjustified negative harm to a group, regardless of its intent.
Use and recognition of the disparate impact theory began in the 1971 U.S. Supreme Court case Griggs v. Duke Power Co. ((1971) 401 U.S. 424.), which related to Title VII of the Civil Rights Act and employment law. Since that time, courts have applied the theory in the employment context through Title VII and the Age Discrimination and Employment Act, as well as housing through the Fair Housing Act. The theory was also applied in various other contexts, such as school and university settings, as well as the activities of local government and other federally supported organizations through Title VI.
In 2025, President Donald Trump issued Executive Order 14281: Restoring Equality of Opportunity and Meritocracy, with the stated purpose of eliminating disparate impact discrimination as a legal theory for individuals and groups to rely on in situations in which they feel they have been discriminated against. Importantly, executive orders are not a legal mechanism for changing the law, but rather a directive from the president to the federal executive branch departments and agencies. Nonetheless, over the past year and a half, several federal agencies have taken action to implement the objectives of Executive Order 14281 and have chipped away at the disparate impact theory. For example, in December 2025, the Department of Justice (DOJ) issued a federal rule eliminating liability for disparate impact discrimination. Similar to the DOJ’s action, the ED has very recently rescinded regulations that recognized disparate impact as a legitimate legal theory to be relied on in Title VI discrimination claims.